Milling of ferrous metals is usually performed by applying cemented carbide tools due to their high hardness, temperature and wear resistance. Recently, ceramic tool materials have been on the rise and enhanced the efficiency in machining. As ceramics are brittle-hard materials, tool manufacturing requires a sound knowledge in order to meet the tool requirements such as sharp cutting edges and wear resistance. In this study, milling tools made of the high performance ceramic SiAlON were compared to tools made from cemented carbide. For both tool materials, the influence of a prepared cutting edge was investigated. Both the tool manufacturing process and the cutting edge preparation processes are presented, followed by the application of those tools within milling experiments. In order to evaluate the efficiency of both tool types, the cutting forces and the cumulative process energy demand were analyzed. Additionally, surface roughness of the machined workpieces and tool wear were examined. It was found that the ceramic tools, although process forces were higher than for cemented carbide tools, exhibited by far lower energy consumption, less tool wear and finally generated lower surface roughness. © 2020, The Author(s).